VF Corp. To Acquire Timberland For $2B

VF Corp., the owner of popular apparel brands Wrangler Jeans and The North Face, said on Monday that it will buy shoemaker Timberland Co. for $2 billion, or 43 percent premium, in an effort to boost its outdoor gear business.

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The owner of popular apparel brands like The North Face and Wrangler Jeans on Monday announced plans to acquire shoemaker Timberland Co. for $2 billion in an effort to boost its outdoor gear business.

In a statement, VF Corp. said that it would buy Timberland for $2 billion or $43 per share, at least 43 percent premium over its closing price of $29.99 at the New Stock Exchange on Friday.

VF Corp. also said that the acquisition would provide an additional earning of 25 cents per share in 2011, and at least 75 cents per share by 2012 – including all expenses related to the acquisition.

Many analysts agreed that the deal between VF and Timberland has been a “fair” acquisition, dismissing claims that it was rather too expensive.

“The price is definitely fair. At first, it seems a bit expensive for VF to buy Timberland for $2 billion, but I think that the shoemaker’s current upswing in terms of business, margins, and revenues makes it a great acquisition,” a New York-based analyst said.

The analyst also doubt that another bidder would come in, saying that the $2-billion price tag is already just.

Immediately after the announcement, Timberland shares spiked up by 42.6 percent to $42.76, while VF’s shares increased by 12 percent to $102.85 per share in premarket trading.